Houston, Texas Msa

REPRESENTATIVE IMAGE

HOUSTON, TEXAS MSA

Jones Lang LaSalle Americas, Inc. EXECUTIVE SUMMARY

HFF L.P., on behalf of the owner, is pleased to exclusively offer for sale the newly constructed Chick-Fil-A (the “Property”) pad site at Palmer Plaza in Texas City, TX, just southeast of Houston. Chick-fil-A occupies ±0.9129 acres of land in Texas City, TX and has signed a 15-year absolute bondable NNN lease which commenced on February 7th, 2019. Shadow anchored by two leading grocery stores, HEB and Aldi, Chick-fil-a is well-positioned in a location with a high volume of foot traffic, which is also generated by a third grocery store, Kroger, located across Palmer Highway. This opportunity offers investors a stable asset with a high quality, investment grade tenant and no landlord responsibilities. INVESTMENT SUMMARY Palmer Plaza Location Texas City, TX 77590 Tenant Chick-fil-A, Inc (Corporate Lease) Site Area 0.9129 acres ABSOLUTE $117,500 MAILBOX Lease Type Absolute “Bondable” NNN BONDABLE YEAR 1 NOI 4,880 SF Rentable Building Area NNN Lease 10% Increases Every Five Years MONEY Construction March 1, 2019 Completion Date Rent Commencement Date February 2019

Lease Expiration Date January 2034

Monthly NOI $9,791.67 105 6 105 CLEVELAND WASHINGTON Annual NOI $117,500.00 CONROE 105 770 336 Six – 5 Year Options (30 Years)SARATOGA with 10% $4.4M* Option Periods 45 HEB & increases 69 MAGNOLIA 242 321 Palmer Highway: 28,000146 VPD PINEHURST THE Trinity River National 15-YEAR Traffic Count 36th St N: 12,051 VPD WOODLANDS 105 AVG. SALES NEW CANEY Wildlife Refuge Remaining Term 290 Total: 40,051 VPD 770 SOUR LAKE ALDI Average Chick-fil-A Store HEMPSTEAD TOMBALL PORTER Grocery Anchored Cap Rate 4.00% 326 6 SPRING - QSR Magazine WALLER LIBERTY DAYTON Asking Price HUFFMAN $2,937,500 90 159 249 HUMBLE ATASCOCITA George Bush CYPRESS International BELLVILLE Airport 8 59 99 ALDINE CROBY 61 JERSEY VILLAGE REPRESENTATIVE IMAGE 6 45 290 69 90 MONT BELVIEU HIGHLANDS 10

65 SEALY BROOKSHIRE KATY 10 10 HUNTERS CHANNELVIEW 330 George Bush JACINTO CITY Park CREEK VILLAGE HOUSTON 99 CINCO RANCH GALENA PARK BAYTOWN 59 BELLAIRE 225 DEER PARK MISSION BEND 610 PASADENA 99 MEADOWS LA PORTE PLACE 90 146

36 PECAN GROVE William P. Hobby 8 Trinity Bay SUGAR LAND Airport Anahuac National Wildlife Refuge RICHMOND 69 PEARLAND SEABROOK 90 ROSENBERG GREATWOOD FRESNO WEBSTER KEMAH EAST BERNARD FRIENDSWOOD 10 LEAGUE CITY BACLIFF East Bay 6 146 BOLIVAR 60 SAN LEON GOAT ISLAND PENINSULA MANVEL DICKINSON Galveston Bay

ALVIN 3 NEEDVILLE 197 288 SANTA FE TEXAS CITY ROSHARON HITCHCOCK 36 35 WHARTON GALVESTON 59 60

2 SITE PLAN

As part of a $3.5M renovation of Palmer Plaza, located on the northeast corner of Palmer Highway and 36th Street North in Texas City, Chick-fil-A has signed a 15-year lease on a front pad shadow anchored by HEB and Aldi. Chick-fil-Abuilt the restaurant at its sole cost and will continue to make rental payments beginning in February 2019. The redevelopment includes adding new tenants such as Aldi and Ross Dress for Less, improving the aesthetics with better lighting, signage and landscaping as well as removing overhead lines that has already played a prominent role in attracting credit tenants. Additionally, existing tenant Dollar Tree will relocate within the shopping center.

residential CCESS ROAD A H S H T CARE ILABL E AVA CLEANER TEXAS CITY URGEN DILLON LIQUOR DILLON LIQUOR T MOBILE CHECKS CASHED 36TH STREET NO RT H RETAIL ACCESS ROAD H 34TH STREET NO RT H 36TH STREET NO RT

ATM 36TH STREET NO RT

GUS’ RESTAURANT HEB FUEL 36TH STREET NO RT

PAL MER HIGHWAY

3 LEASE ABSTRACT

CHICK-FIL-A LEASE ABSTRACT

Address: Palmer Plaza

Texas City, TX 77590

Lessee: Chick-Fil-A, Inc (Corporate Lease)

Trade Name: Chick-Fil-A

Rentable Building Area 4,880 SF

Site Area: 0.9129 Acres

Rent Commencement Date: February 4th, 2019

Term: 15 Years (After the Rent Commencement Date)

Base Rent: Years Monthly NOI Annual NOI

Year 1 - Year 5 $9,791.67 $117,500.00

Year 6 - Year 10 $10,770.83 $129,250.00

Year 11 - Year 15 $11,847.92 $142,175.00

Year 16 - Year 20 (Option Period I) $13,032.71 $156,392.50

Year 21 - Year 25 (Option Period II) $14,335.98 $172,031.75

Year 26 - Year 30 (Option Period III) $15,769.58 $189,234.93

Year 31 - Year 35 (Option Period IV) $17,346.53 $208,158.42

Year 36 - Year 40 (Option Period V) $19,081.19 $228,974.26

Year 41 - Year 45 (Option Period VI) $20,989.31 $251,871.69

Taxes, Insurance, Maintenance: Paid by Tenant directly to billing authority

Tenant Renewal Notice: 9 months before the expiration of the current term

Permitted Use: Any lawful retail purpose, including a restaurant

Vesting of Buildings and Improvements: Upon the expiration or sooner termination of the Lease, and so long as Tenant has no further leasehold or ownership interest in the real property constituting the Demised Premises, title to any buildings or improvements located on the Land (as such term is defined in the Lease), including those constituting the Demised Premises, will vest in and becomethe full and absolute property of Landlord.

Casualty: If the building upon the land shall be destroyed or damaged by fire or other casualty:

A) to any extent during the last 5 years of the initial term or any extension period OR B) At any other time to the extent 25% or more of the full replacement value,

Tenant may elect to terminate the lease with 60 days notice. Tenant is responsible for demolition and debris removal with written notice from landlord. If tenant does not elect to terminate the lease, they shall restore the improvements to prior condition and continue paying rent.

4 TENANT PROFILE

SANDLEMAN’S AWARDS OF EXCELLENCE 2018 1 TOP FAST FOOD CHAINS Rank Company $4.4 #1 8TH #1 1 Chick-Fil-A NATIONWIDE 2 In-N-Out Burger MILLION LARGEST FAST FOOD 3 Raising Cane’s Average Revenue per Store in Customer Loyalty fast-food chain (revenue) Chain 4 La Madeleine 5 Torchy’s Tacos Source: QSR Magazine Source: Delish & Fox Business Source: QSR Magazine Source: Sandleman’s Awards of Excellence 6 Five Guys 7 Lion’s Choice With more than 2,300 stores in 47 states and Washington D.C., Chick-Fil-A has become the largest quick service chicken restaurant 8 P. Terry’s 9 Habit chain in the United States. The privately held company is headquartered in College Park, Georgia, was founded in 1946, and has the 10 Mod Pizza largest revenue per restaurant of any other fast food chain in the US ($4+ million in 2017). Even though it is closed on Sunday, Chick- * The top ten chains were excellent in taste and fil-A generates more revenue per restaurant than McDonald’s, Starbucks, and Subway combined. The Company has the 8th largest the quality of their food. Other factors were revenue of all quick service restaurants ($9 Billion in 2017 with 49 consecutive years of sales growth) despite having about 3000 less health and kid appeal. stores than the smallest competitor in the top-7. The fast-food chain, best known for its Chick-fil-A® Chicken Sandwich, has seen consistent growth by adding 75 to 80 stores yearly and only accepting 0.4% of franchisee applicants. AMERICAN CONSUMER SATISFACTION INDEX 2018 CUSTOMER EXPERIENCE RANKS AMONG THE BEST TOP FAST FOOD CHAINS Chick-Fil-A is able to maintain the highest revenue per restaurant amongst fast food chains due to customer loyalty, a unique menu, Company Score and a friendly staff providing an enjoyable dining experience. Chick-Fil-A 87 • Recognized for customer experience in the 2018 Temkin Experience Ratings survey Panera Bread 81 Papa John's 80 • Earned the top spot in American Customer Satisfaction Index’s 2018 survey of customer satisfaction. Pizza Hut 80 • Named “Best Franchise Brand” in 2018 by Airport Revenue News. Subway 80 • The Temkin Report found that fast food chains had the 4th highest loyalty rating of 20 industries, only trailing supermarkets, hotels, Arby's 79 Chipotle 79 and retailers Domino's 79 • Ranked #1 quick service restaurant for “Consumers Choice – Best Overall” category by the Technomic 2018 Consumers’ Choice Dunkin Donuts 78 Awards Starbucks 78

• Only restaurant brand named to the Top 10 “Best Companies to Work For” by 24/7 Wall Street * The American Customer Satisfaction Index • Ranked 4th overall, scoring an 81.68 out of 100 on Harris Poll’s Reputation Quotient (80.00 or higher is considered excellent) (ACSI®) is a national economic indicator of customer evaluations of the quality of • Chick-fil-A locations generate more revenue than any other fast-food restaurant in the U.S. The average franchise of the chicken products and services available to household consumers in the United States. company saw $4.4M in sales in 2016, according to restaurant trade publication QSR. The next-closest chains in per-store sales were Panera Bread and Whataburger, at $2.7M each. - Biznow June 7, 2018

5 105 6 105

105 770 336

45 69 242 321 LOCATION HIGHLIGHTS 146 Trinity River National 105 Wildlife Refuge 290 770

Chick-fil-A is shadow anchored by two leading grocers, HEB and Aldi, with a third grocer, DEMOGRAPHIC 326 6 Kroger, located across Palmer Highway. With Palmer highway frontage, the property will Population 1-mile 3-mile 5-mile 2023 Projection 8,069 49,284 71,218 be easily accessible and visible to both residential and workforce customers. Alternatively, 2018 Estimate 7,580 46,596 66,948 the restaurant is a part of a major retail redevelopment which has already attracted credit 90 159 249 2010 Census 6,906 42,489 60,381 tenants that generate significant foot traffic to the shopping center. Surrounded by multiple 2000 Census 6,868 41,999 58,074 GeorgePopulation Bush Growth residential neighborhoods, Chick-fil-A will benefit from the family-oriented population,International 2000 to 2010 0.6% 1.2% 4.0% Airport which experienced growth rates among the highest in Houston due to the growth8 of the 2010 to 201859 9.8% 9.7% 10.9% 99 petrochemical industry. Texas City is a busy deep-water port on Texas’ Gulf Coast, as well 2018 to 2023 6.5% 5.8% 6.4% 61 as a petroleum-refining and petrochemical-manufacturing center; this creates a demand HH Income 2018 Est. Average Household Income $57,280 $63,942 $67,826 for jobs allowing an increase in disposable income. In efforts6 to increase population density 45 Home Value and job opportunities, Texas City has been authorized to offer developers290 incentives 201869 Est. Median All Owner-Occupied90 Housing Value $93,806 $102,177 $110,746 designed to promote economic development such as commercial and retail projects under 10

Chapter 380 of the local government code. The population was 48,558 in 2017, making it 65 10 10 330 the third-largest city in Galveston County, behind LeagueGeorge Bush City and Galveston. Park 99

59 225 610

90 146 Trinity Bay

36 William P. Hobby 8 Airport Anahuac National Wildlife Refuge 69

10 East Bay 6 146 60 Galveston Bay

3 197

288 5-Mile 10-Mile

36 35

59 60

6 TEXAS CITY REFINERIES

PALMER HIGHWAY | 28,000 VPD

N 34TH STREET

MAGNOLIA AVENUE

STATE HIGHWAY 146 | 43,000 VPD TEXAS CITY OVERVIEW

Texas City is defined by it’s particularly strong economic base, which is built around the petrochemical industry, good educational institution capacity, and a strong health care industry. Texas City employers employ a highly skilled, technical workforce which should be an attraction to newly developing markets in science education products and systems, health care products, and home health care services. Part of the economic development focus of the city will be on recruiting and encouraging new business developments that target these areas. Efforts will be directed toward firms which could be the most successful in the Texas City area, and which can best take advantage of the community’s resources

ECONOMY The Texas City economy has long been based on heavy industry, particularly shipping at the Port of Texas City, as well as petroleum and petrochemical refining. The Texas City Industrial Complex is a leading center of the petrochemical industry. Within this complex, the Galveston Bay Refinery operated by Marathon is the second-largest petroleum refinery in Texas and third-largest in the United States. The Port of Texas City became the third-leading port in Texas by tonnage and ninth in the nation. In recent decades, the city’s planners have made efforts to diversify the economy into tourism, health care, and many other sectors. As early as 1974, Texas City was placed on the top-ten list for the EPA superfund. Outdated practices for the disposal of toxic waste have continued there for years.

As of 2010, SSA Marine Company had plans to build a major new cargo container shipping terminal known as the Texas City International Terminal at Shoal Point. The project is intended to capitalize on the expansion of the Panama Canal, scheduled for EXPANDING PETROCHEMICAL MARKET completion in 2014, which city officials expect to substantially increase trade between Houston is home to the largest petrochemical complex in the nation and the second- the Gulf Coast and Asia. largest in the world. The Houston petrochemical complex represents 25% of U.S. The Port of Texas City, operated by the Port of Texas City / Texas City Terminal Railway, refining capacity and 40% of U.S. petrochemical capacity and is located along the 25- is the eighth-largest port in the United States and the third-largest in Texas, with mile Houston Ship Channel at the Port of Houston. waterborne tonnage exceeding 78 million net tons. The Texas City Terminal Railway In the Texas Gulf Coast region, more than 20 Polyethylene projects worth more than Company provides an important land link to the port, handling over 25,000 carloads $50 billion are under construction and are scheduled to open within the coming years, per year. The Port of Texas City’s success as a privately-owned port has been aided by as companies invest in new ethylene crackers, propylene production units, refineries its shareholders, the Union Pacific and Burlington Northern Santa Fe railroads, whose and other expansion projects. The primary driver of this activity is that petrochemical connections allow for expeditious interchange of their traffic. enterprises benefit directly from lower oil and natural gas prices, as this reduces their cost to purchase their primary feed stocks for producing/refining plastics, resins, and other petrochemical products, and transporting oil and natural gas across geographies.

8 TEXAS CITY OVERVIEW

This flurry of petrochemical construction – as firms continue to take advantage of a Many graduates have returned to Texas City and La Marque to raise their own children low-cost feed stock environment is expected to create tens of thousands of construction who are now on the path for their own success. The goals in Texas City ISD are high jobs in the short-term and the need for thousands of blue-collar jobs in the longer-term. and are being accomplished thanks to the continued effort by the district, students, parents and the community. Texas City ISD has proven throughout the last century to EDUCATION be one of the more innovative school districts in Texas. The Property is located in the Texas City Independent School District (TCISD), which serves most of Texas City, and a portion of Tiki Island. On December 2, 2015, Texas Education Agency Commissioner Michael Williams announced that Texas City ISD would absorb the La Marque Independent School District (LMISD) effective July 1, 2016; the LMISD annexation increased the size of TCISD by about 33%

The school district accounts for nearly 9,000 students, 14 distinct campuses (4 high schools, 3 middle schools, 7 elementary schools), and 10 Afterschool Centers on Education (ACE) administered by the Texas Education Agency. Texas City ISD has a proud past and a promising future. Graduates have gone on to write and direct world-renown movies, play professional sports, lead military units, preside as judges in courts, serve as State Senators, and more; they have become doctors, lawyers, business owners, mayors and teachers.

9 ADDITIONAL INFORMATION

Jones Lang LaSalle Americas, Inc. or its state-licensed affiliate (“JLL”) has been engaged by the owner of the property [properties] to market it [them] for [sale] [lease]. Information concerning the property [properties] described herein has been obtained from sources other than JLL, and neither Owner nor JLL, nor their respective equity holders, officers, directors, employees and agents makes any representations or warranties, express or implied, as to the accuracy or completeness of such information. Any and all reference to age, square footage, income, expenses and any other property specific information are approximate. Any opinions, assumptions, or estimates contained herein are projections only and used for illustrative purposes and may be based on assumptions or due diligence criteria different from that used by a purchaser. JLL and owner disclaim any liability that may be based upon or related to the information contained herein. Prospective purchasers should conduct their own independent investigation and rely on those results. The information contained herein is subject to change. The Property may be withdrawn without notice. If the recipient of this information has signed a confidentiality agreement regarding this matter, this information is subject to the terms of that agreement. ©2019. Jones Lang LaSalle IP, Inc. All rights reserved.

Deals represented were secured by Holliday Fenoglio Fowler LP (“HFF”) prior to being acquired by JLL. HFF is now a JLL company. Jones Lang LaSalle Americas, Inc. (or Jones Lang LaSalle Americas (Illinois), L.P. for Illinois listings) are providing co-brokerage services for HFF listings, and licensees may hold licenses with either HFF or such JLL entities. ©2019. Jones Lang LaSalle IP, Inc. All rights reserved.